The future of bricks and mortar stores and my experience of connected stores in New York.
Digital era with millennials’ buying power peaking is challenging for retailers that have faced tremendous changes in the past several years. With the rise of the Internet, many saw an opportunity to drive sales through one extra channel — eCommerce. A visit to the bricks and mortar store has so become just one of many moments in the journey that customers take while discovering the brand and shopping for products. Therefore, it is important that they have a unique role in the ecosystem of touch points.
As consumers in general are getting more familiar and comfortable with the artificial intelligence technology, retailers have started to exploit this with the implementation of different features in physical stores to enrich the experience of their visitors. So called connected stores encourage visitors to gather information about the products on their own terms and controlled by them.
There is no better place to discover connected stores than New York City (NYC), one of the shopping heavens. I visited some of these new stores — Adidas, Nike, Amazon Books and Rebecca Minkoff. The later one impressed me most and the sales assistants gave me a glimpse on how this is performing in every day life.
Connectivity features at Rebecca Minkoff store in Soho
Rebecca Minkoff is known for fusing an urban vibe with feminine styling; not only when designing fashion garments, but also when thinking about its visitors’ experience. The store in the heart of Soho in NYC welcomes its visitors first with a large digital wall (5×12 feet) that lets them order a drink or request personal help from employees. Besides showing the products, the touchscreen also lets users enter requested personal information and notifies them when sales assistants are on their way. This should be more appealing for the visitors than wandering aimlessly, or having to deal with an associate asking how they can help every time they make an accidental eye contact.
All items in the store use RFID tags (radio frequency identification tags) that communicate with fitting rooms. When visitors enter those, items are detected by the system and displayed on the screen/mirror. Visitors can use those interactive displays to browse and order different styles or sizes without leaving the room — quite handy when you’re semi-naked in the dressing room. They can additionally control the lighting in their cabin and set it to five different settings.
After deciding for an item visitors can check-out on their own. The store doesn’t use the same technology as Amazon Go stores, but rather the technology we know from some supermarkets. The data from items placed on the check out RFID-powered table is collected in the tablet, that visitors could use to check-out. They have to enter their email address and swipe the credit card and they’re ready to go… almost. The problem is, before they can walk out, they have to take off the security tags of the items purchased and inserting them into a small machine, which sometimes requires assistance from the professionals.
A brief chat with the employees shows, that the digitalization removes some of the human interaction that the visitors might find unpleasant, such as being judged. However, the process isn’t as seamless as we expected anyway, especially when it comes to the check-out. The digital wall and smart mirrors, on the other hand, are not obtrusive and quite useful to browse a look book and remotely order clothes.
Retailer’s benefits from connected stores
In the past brands have designed their stores from a creative mindset, as they didn’t have much data-backed insights, but as we witnessed, times are changing. Today not only store visitors, but also brands can leverage on in-store technology to make smart and data-driven decisions that help them transform their store fleet into high engaging connected stores.
The most valuable data points that retailers can collect fall into three sets: the customer, the products and the employees. Depending on the industry retailers can use the data in different ways. In case of brand stores, they’re probably most interested in what customers are doing in the shop. Rebecca Minkoff for example can find out what is taken into the fitting room, what’s being purchased or left behind, and what new directions it should be heading in as an emerging name in retail. Other retailers that are more concerned about the traffic can measure how many people visit and how long do they stay. Again another type of retailers can measure the employee performance, etc.
Moreover, connected stores enable retailers to measure the impact of their investments in digital channels and infrastructure on the performance of their offline stores; the Research online, purchase offline (RoPo) effect.
Ready or not, connected stores are the future
Connected stores are not only about collecting the data, but more about how to use that data effectively and turn insights into actions. Each store has unique needs when it comes to in-store technology and features; not all stores need to have flashy machinery that customers see. Therefore, in order to engage with the visitors in the right way, knowing the customer is still the first task on every brand’s to do list.
As the number of touch points that retailers have with their consumers is dramatically increasing, it is important that they approach the full customer journey strategically. Retailers are not fighting only for the wallet anymore, but also for the time. Their consumers should want to spend time with them. They are competing not only with other retailers, but with any other place that their consumers would usually spend their time with.
Customers are looking for personalized experience and retailers have to start investing in delivering the right experience at the right time and place. Rebecca Minkoff’s approach to technology isn’t revolutionary, but its willingness to explore it is notable when considering how slow the fashion world has been to embrace it. Things are changing fast, though, leading designers and brands must look to technology in order to make their customers’ journeys more engaging and not intrusive.